The Crypto Accounting Conundrum
The major problem with Crypto accounting and tax industry is that the regulation and rules are not clear. Since the environment is cloudy, most Crypto participants and accountants are winging the tax filings without understanding potential consequences.
With such a massive influx of cryptocurrency investors over the last few years, the accounting industry has been unable to fill the demand. There is simply not enough crypto tax experts keeping up with new regulation and laws. Therefore, the crypto community is being forced to improvise their crypto taxes, leading to major problems at year-end.
Due to cryptocurrencies' decentralized nature and tricky accounting rules, calculating an individual, let alone companies, crypto tax liability can become overwhelming very quickly. Compile this with each country's required cost basis, the potential problems can be endless.
As we slowly enter the adoption phase, the crypto sphere will continually and rapidly evolve, giving life to products and protocols that did not exist a year ago. With this comes the struggle of taxation and how to properly account for new types of income or gains.
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